Choose S. Iraq or Kurdistan, Iraq tells Exxon

Baghdad, January 27, 2013

Iraq has told Exxon Mobil that it must choose between working in the country's southern oilfields or in autonomous Kurdistan, and expects the US oil major to make a final decision in a few days, the oil minister said on Sunday.

"We made it clear to Exxon in the last meeting that the answer we expected from them is to either work in the Kurdistan region or to work in southern Iraq," Oil Minister Abdul Kareem Luaibi told reporters in Baghdad.

"Exxon Mobil cannot work in both fields at the same time."

Baghdad says any deals signed with Kurdistan are illegal, but Kurdistan's regional government says the constitution allows it to sign oil agreements with companies like Exxon without permission from the central government.

Exxon's top executive met with Iraqi Prime Minister Nuri Al-Maliki and with Kurdistan's president last week to discuss oil operations in both regions as industry sources said the US company was mulling an offer from Baghdad.

Iraqi officials said then that Exxon was moving in the right direction in its policy, but Kurdistan also said the company remained committed to its Kurdish deals.

Exxon was the first major oil company to sign up for agreements with the Kurdistan region, a move that increased tensions between Baghdad and the Kurds in their long-running dispute over oil, territory and political autonomy. - Reuters